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Strategic analysis on telecom industries

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Management Concepts & Practice
1 | P a g e
STRATEGIC ANALYSIS
ON
TELECOM INDUSTRY
Presented By-
Ashish Sharma
Management Concepts & Practice
2 | P a g e
OBJECTIVE:
Objective of the assignment is to find out the Strategic Analysis of...
Management Concepts & Practice
3 | P a g e
Telecommunication in India has greatly been supported by
the INSAT system of th...
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Strategic analysis on telecom industries

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this is the analysis done by me on telecom sector. in this there is the objective of survey, its introduction and to make it more clear i have taken the example of airtel company and with this example i have explained everything.

this is the analysis done by me on telecom sector. in this there is the objective of survey, its introduction and to make it more clear i have taken the example of airtel company and with this example i have explained everything.

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Strategic analysis on telecom industries

  1. 1. Management Concepts & Practice 1 | P a g e STRATEGIC ANALYSIS ON TELECOM INDUSTRY Presented By- Ashish Sharma
  2. 2. Management Concepts & Practice 2 | P a g e OBJECTIVE: Objective of the assignment is to find out the Strategic Analysis of the following tools for Telecom Industry: · SWOT · Porter’s five force model, · PEST. In this the SWOT analysis generally works for the product, Porter’s five force models on company and PEST analysis generally work on the Industry. INTRODUCTION: TELECOM INDUSTRY: India's telecommunication network is the second largest in the world based on the total number of telephone users (both fixed and mobile phone). It has one of the lowest call tariffs in the world enabled by the mega telephone networks and hyper-competition among them. It has the world's third-largest Internet user-base. According to the Internet and Mobile Association of India (IAMAI), the Internet user base in the country stood at 190 million at the end of June, 2013. Major sectors of the Indian telecommunication industry are telephony; internet and television broadcast Industry in the country which is in an ongoing process of transforming into next generation network
  3. 3. Management Concepts & Practice 3 | P a g e Telecommunication in India has greatly been supported by the INSAT system of the country, one of the largest domestic satellite systems in the world. India possesses a diversified communications system, which links all parts of the country by telephone, Internet, radio, television and satellite. TELECOM INDUSTRY
  4. 4. Management Concepts & Practice 4 | P a g e AIRTEL: Airtel is the largest provider of mobile telephony and second largest provider of fixed telephony in India, and is also a provider of broadband and subscription television services. It offers its telecom services under the "airtel" brand, and is headed by Sunil Bharti Mittal. Bharti Airtel is the first Indian telecom service provider to achieve Cisco Gold Certification. It also acts as a carrier for national and international long distance communication services. The company has a submarine cable landing station at Chennai, which connects the submarine cable connecting Chennai and Singapore. Bharti Airtel added 5.10 lakh subscribers to take its base to 20.97 crore at the end of July, 2014. Its market share in India is highest with a value of 28.41%.
  5. 5. Management Concepts & Practice 5 | P a g e SWOT ANALYSIS ON PRODUCT AIRTEL CELLULAR: STRENGTH:  Bharti Airtel has more than 65 million customers (July 2008). It is thelargest cellular provider in India, and also supplies broadband a ndtelephone services as well as many other telecommunications services to both domestic and corporate. STRENGTH WEAKNESS OPPORTUNITIES THREATS AIRTEL
  6. 6. Management Concepts & Practice 6 | P a g e  Other stakeholders in Bharti Airtel include Sony-Ericsson, Nokia and SingTel, with whom they hold a strategic alliance. This means that the business has access to knowledge and technology from other parts of the telecommunications world.  The company has covered the entire Indian nation with its network. This has underpinned its large and rising customer base. WEAKNESS:  An often cited original weakness is that when the business was startedby Sunil Bharti Mittal over 15 years ago, the business has lit tleknowledge and experience of how a cellular telephone system actually worked. So the start-up business had to outsource to industry experts in the field.  Until recently Airtel did not own its own towers, which was a particular strength of some of its competitors such as Hutchison Essar. Towers are important if your company wishes to provide Wide coverage nationally.  The fact that the Airtel has not pulled off a deal with South Africa MTNcould signal the lack of any real emerging market investment opportunityfor the business once the Indian market has become mature
  7. 7. Management Concepts & Practice 7 | P a g e OPPORTUNITIES:  The company possesses a customized version of the Google search engine which will enhance broadband services to customers. The tie-up with Google can only enhance the Airtel brand, and also Provides advertising opportunities in Indian for Google.  Global telecommunications and new technology brands see Airtel as key strategic player in the Indian market. The new iPhone will Be launched in India via an Airtel distributorship. Another Strategic partnership is held with BlackBerry Wireless Solutions.  Despite being forced to outsource much of its technical operations in the early days, this allowed Airtel to work from its own blank sheet of paper, and to question industry approaches and practices â for example replacing the Revenue- Per-Customer model with a Revenue-Per-Minute model which is better suited to India, as the company moved into small and remote villages and towns.  The company is investing in its operation in 120,000 to 160,000 small villages every year. It sees that less well-off consumers may only be able to afford a few tens of Rupees per call, and also so that the business benefits are scalable using it Match box strategy.  Bharti Airtel is embarking on another joint venture with Vodafone Essar and Idea Cellular to create a new independent tower company called Indus Towers. This new business will control more than 60% of Indianetwork towers. IPTV is another potential new service that could underpin the company long – term strategy.
  8. 8. Management Concepts & Practice 8 | P a g e Threats:  Airtel and Vodafone seem to be having an on/off relationship. Vodafone which owned a 5.6% stake in the Airtel business sold it back to Airtel, and instead invested in its rival Hutchison Essar. Knowledge and technology previously available to Airtel now moves into the hands of one of its competitors.  The quickly changing pace of the global telecommunications industry could tempt Airtel to go along the acquisition trail which may make it vulnerable if the world goes into recession. Perhaps this was an impact upon the decision not to proceed with talks about the potential purchaseof South Africa MTN in May 2008. This opened the door for talksbetween Reliance Communication A nil Ambani and MTN, allowing acompeting Indian industrialist to invest in the new emerging African telecommunications market.  Bharti Airtel could also be the target for the takeover vision of other global telecommunications players that wish to move into the Indian market.
  9. 9. Management Concepts & Practice 9 | P a g e PORTERS 5 FORCES MODEL ON COMPANY: INTRODUCTION TOPORTER FIVE FORCES: Porter (1980) gave the idea of deployment of five forces for the analysis. These five forces are (1) the threats of substitute products or services (2) the threats of the entry of the new competitors (3) the intensity of competitive rivalry (4) the bargaining power of buyers (5) the bargaining power of suppliers. He said that these forces jointly determine the competitive intensity of a firm within the industry. Strength of these forces leads to lower profitability of an organization and vice versa.
  10. 10. Management Concepts & Practice 10 | P a g e Bargaining Power of Supplier  Many vendors are available (infrastructure, fiber optic cables, software…).  Limit on personnel, talented managers and engineers. Bargaining Power of Customers:  Rising power due to increased number of telecom products – Very little differentiation.
  11. 11. Management Concepts & Practice 11 | P a g e  Switching costs are low for residential customers, but may be high for corporations. Threat of New Entrants  Access to finance (high fixed costs).  Entrants are subject to financial state.  FCC Still gives telecom licenses.  “Good” Radio spectrum. Threat of Substitute Products  Cable TV and Satellite compete.  Internet voice “Internet telephony”. Competitive Rivalry  “Cut Throat”.  New technology is creating substitute services.  Market is nearly at capacity.
  12. 12. Management Concepts & Practice 12 | P a g e PEST ANALYSIS ON INDUSTRY. PEST analysis of any industry sector investigates the important factors that are affecting the industry and influencing the companies operating in that sector. PEST is an acronym for political, economic, social and technological analysis. Political factors include government policies relating to the industry, tax policies, laws and regulations, trade restrictions and tariffs etc. The economic factors relate to changes in the wider economy such as economic growth, interest rates, exchange rates and inflation rate, etc. Social factors often look at the cultural aspects and include health consciousness, population growth rate, age distribution, changes in tastes and buying patterns, etc. The technological factors relate to the application of new inventions and
  13. 13. Management Concepts & Practice 13 | P a g e ideas such as R&D activity, automation, technology incentives and the rate of technological change. POLITICALFACTOR:  Antitrust Regulations  Environmental  Protection laws  Tax laws  Special incentives  Foreign trade regulations  Attitudes toward foreign companies  Laws on hiring and promotion  Stability of government ECONOMICALFACTOR:  GDP trends  Interest rates  Money supply  Inflation rates  Unemployment levels  Price control  Devaluation Revaluation  cost
  14. 14. Management Concepts & Practice 14 | P a g e SOCIALFACTORS:  lifestyle Changes  Career Expectation  Consumer activism  Rate of family formation  Growth rate of population  Age distribution of population  Regional shift in population  Life expectations  Birth rates TECHNOLOGICALFACTOR:  Total government spending for research and development  Total industry spending for research and development  Focus of technological efforts  Patent protection  New products  Technology transfer from lab and market place  Productivity improvement through automation  Internet availability
  15. 15. Management Concepts & Practice 15 | P a g e BIBLIOGRAPHY:  http://en.wikipedia.org/wiki/Telecommunications_in_India  http://en.wikipedia.org/wiki/Bharti_Airtel  http://www.scribd.com/doc/50192017/SWOT-Analysis-Bharti- Airtel-PPT#scribd  https://www.academia.edu/5994017/Porter_Five_Forces_Analysis _of_the_Leading_Mobile_Cellular_Telephony_Service_Provider_i n_India_  http://www.columbia.edu/cu/consultingclub/Resources/Telecomm unications_Pablo_PrietoMunoz.pdf  https://www.asdreports.com/shopexd.asp?id=4450  http://www.scribd.com/doc/27121254/Pest-Analysis-Indian- Telecom-Industry#scribd

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